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1 Tel, Fax: Office ( The Chair 4330 Kngsway. Burndby BC Canada VSH 4GB www merrovancouverorq Attachment: New Waste-to-Energy Consultation and Procurement Decisions report to the Metro Vancouver Zero Waste Committee - February 16, 2012 ( ) Chair, Metro Vancouver Board Greg Moore Yours truly, I look forward to working together over the coming months. developing new waste-to-energy capacity for Metro Vancouver, including a broad community consultation plan as one of the first key components. As described in the report, initial steps to short-listed proponents identified by the end of identify potential proponents, both in-region and out-of-region will not take place until summer, with 16, 2012 Zero Waste Committee meeting. The report outlines our next steps in proceeding with A report to the Metro Vancouver Zero Waste Committee (attached) was presented at the February consultation and I respect the positive relationship the City of Abbotsford and Metro Vancouver waste-to-energy capacity for the region. I appreciate your willingness to engage in meaningful have worked to develop. It is upon this foundation that we will face the challenges ahead. Thank you for your letter of January 31, 2012 regarding Metro Vancouver s plans to develop new Re: City of Abbotsford and Metro Vancouver s Plan for Waste-to-Energy Dear Abbotsford, BC V2T 1W South Fraser Way City of Abbotsford Mayor Bruce Banman FEB Ref: CAO File: CP SW2-006 metrovancouver

2 From: Paul Henderson, Manager, Solid Waste Department To: Zero Waste Committee Zero Waste Committee Meeting Date: February nq iij C c d H C ?O ivw lttr an<. Meaningfully consult with the Fraser Valley Regional District Guiding princ!pies for developing new WTE capacity include: WTE solutions. Vancouver to consider all WTE technology options and consider both in and out-of-region On July , the BC Minister of Environment approved the ISW AMP subject to eleven (Minister s approval attached). The Ministers approval specifically requires Metro conditions which will enhance the effectiveness and transparency of the ISWRMP municipal sohd waste. waste diversion. n adopting the Integrated Solid Waste and Resource Management Plan year (tpy) of new vasteto-energy (WTE) capacity to manage the regton s remaining (ISWRMP), the GVS&DD Board approved a strategy to develop up to tonnes per On July in addition to waste reduction, reuse and recycling initiatives to increase 2. CONTEXT selection processes. WTE capacity and on procurement decisions related to WTE project technology and site To seek direction from the Board to explore options for consultation with the FVRD on new d.) Encourages proposals that include a site along with proposed technology solution. c.) Considers all WTE technology options within one Request for Proposals. 2. That the Board direct staff to initiate a procurement process that ultimately: communications strategy. for the FVRD consultation process as well as a broader consultation and waste-to-energy (WTE) consultation process. a.) Liaise with Fraser Valley Regional District (FVRD) staff to develop a proposed 1. That the Board direct staff to: b.) Report back to the Board through the Zero Waste Committee with recommendations 1. PURPOSE Recommendations: Subject: New Waste-to-Energy Consultation and Procurement Decisions Date: January 30, 2012 metro vanco UV e r 5.2

3 New Waste-to-Energy Consultation and Procurement Decisions Zero Waste Committee Meeting Date February 16, 2012 Page 2 of 5 Consider all waste-to-energy technology options. including both emerging and established technologies Consider both in-region and out-of region options Ensure maximum environmental, financial and social benefits in the evaluation of waste-to-energy alternatives. Communications and Consultation As part of the Minister of Environments approval of the (SWAMP, the Minister required that Metro Vancouver consult the FVRD, and at a minimum establish a working group with the FVRD to develop recommendations on emissions standards, environmental monitoring, mitigation measures to address reasonable concerns from the FVRD and to consider other issues related to the establishment of an in-region WTE facility. The Minister required these recommendations be developed in advance of the start of construction of any new or expanded in-region WTE facility and within one year of Metro Vancouver deciding to pursue an in-region WTE solution. Even though a decision on locating a new WTE facility will be made later in the procurement process. staff recommend engaging FVRD staff without delay to develop recommendations for a consultation process to engage both the FVRD and Fraser Valley municipalities. Metro Vancouver staff will design a broad consultation. communications and engagement process to support development of new WTE capacity. The process will ensure both the public and stakeholders are informed and engaged as the project develops. Procurement Process Metro Vancouver staff will work with external consultants and other stakeholders to develop a procurement process. Staff expect that the process will involve a minimum of two steps to allow short-listing proponents to a small number of capable teams. Metro Vancouver staff expect that publicly seeking proponents will begin sometime in late summer with shortlisted proponents identified by the end of System Capacity and Technology The (SWAMP envisions up to tpy of WTE processing capacity to manage the municipal solid waste (MSW) remaining after waste reduction, reuse, and recycling. Since the ISWRMP was initially developed, MSW quantities to disposal have decreased for various reasons. Total Metro Vancouver system MSW equaled approximately 1.0 million tonnes in down from approximately 1.3 million tonnes in The existing Metro Vancouver WTE Facility processes approximately tpy of MSW and therefore, landfill disposal in equaled approximately tonnes. Staff expect regional waste quantities in 2012 to decline further compared to Future MSW quantities are uncertain because a number of factors in addition to waste reduction and recycling are affecting MSW quantities. Given the uncertainty of future MSW quantities. staff recommend developing between 250,000 and tpy of new WTE capacity, a similar scale to the existing Metro Vancouver WTE Facility in Burnaby. Staff will refine this requirement during the procurement process to ensure that no excess capacity is constructed while minimizing landfill disposal.

4 New Waste-to-Energy Consuttation and Procurement Decisions Zero Waste Committee Meeting Date: February 16, 2012 Page 3 of 5 In seeking appropriate WTE technology to meet future regional needs. Metro Vancouvers goals are to protect the environment, maximize the potential for a successful project and minimize risk to the taxpayer. Other communities have taken a range of approaches to this challenge: The Regions of Durham and York (Ontario) concluded after a comprehensive review of available technology options that mass burn WTE was most appropriate. The City of Los Angeles has taken the approach of carving off a portion of their total waste requiring processing for non-mass burn technologies to support emerging technology solutions. The cities of Edmonton and Ottawa are pursuing non-mass burn WTE solution, but for a relatively small portion of their total annual waste quantities (Edmonton - 100,000 tpy facility under development using gasification to produce bio-fuel; Ottawa - initially 30,000 tpy facility under development using plasma-arc gasification to generate electricity). Section 3 Alternatives, provides two alternative approaches to seeking proposals for new WTE capacity. Site To provide maximum opportunity to potential proponents to participate in a procurement process, the traditional option is for the owner to provide a site for the project, ideally with environmental and municipal approvals already in place to the extent possible. Again various jurisdictions have approached siting in different ways. The Regions of Durham and York selected a site in advance of selecting the preferred WTE technology provider. According to a May 2008 Municipality of Durham report. selecting a WTE site was finalized more than two years after an environmental process was initiated. In Los Angeles, the City selected the preferred WTE technology providers prior to determining site locations. The Los Angeles process has been underway for several years without selecting a site. assessment Section 3 Alternatives, provides two alternative approaches to identifying project sites. Business Model vl A new WTE facuty be funded in the same manner as the rest of the solid waste disposal system. throuqh tpping fees by system users. Staff will work with external fnancai technical support to determine the most beneficial project business model. minimizing impact on tipping fees and maximizing revenues from energy and material sales. pad Next Steps The next steps involved in developing new WTE capacity include: 1. Work with FVRD staff to develop a proposed consultation process as described 3bove. 2. Secure outside technical resources including a technical and financial consultant, a fairness advisor and other third party corsuitants as required.

5 New Waste-to-Energy ConsuJtation and Procurement Decisions Zero Waste Cornmttee Meeting Date: February 16, 2012 Page 4 at 5 3. Engage the Independent Third Party Expert panel. On July the GVS&DD Board directed staff to engage an Independent Third Party Expert to ensure that Metro Vancouver s request for proposals considers all technology options and evaluation criteria are not biased to any particular technology. Given the procurement process will begin over the next few months, staff are moving forward to engage the Independent Third Party Expert. To provide a balanced perspective and broad experience base, a three-person panel will be engaged. Staff will seek panel members from the following knowledge areas: Waste-to-energy technical expertise Sustainability and energy Air emissions and health 4. Assess business model options, and explore potential funding strategies and opportunities. 5. Identify proponents to shortlist through a public competitive selection process. 3. ALTERNATIVES System Capacity and Technology As indicated in Section 2 Context, staff have identified two alternative approaches for soliciting proposals to develop new WTE capacity. Option 1: Two RFPs, one excluding mass-burn WTE The benefit of designating a portion of waste to non-mass burn technology solutions (suggest 20% of total required capacity or approximately 50,000 to 80,000 tpy) is to allow emerging technologies with a relatively short track-record to be considered. Proposals for non-mass burn technologies would be sought in a separate AFP. Option 2: Single RFP considering all technology options Under this option, a single request for proposals would be issued for WTE systems to manage the total waste quantity requiring processing, between 250,000 and 400,000 tpy. Metro Vancouver would ensure that the request for proposals consider all WTE technologies and is not biased to a particular option. Given reduced waste flows, the amount of waste available for WTE is less than initially expected and thus reducing waste available to a primary WTE system by carving off a portion of the amount of waste available for non-mass burn WTE will diminish the economic v abil ty of the primary system due to reduced economies of scale. Additionally, the ncremerital cost of adding waste to a primary WTE system will be significantly less than the cost of a stand-alone small scale WTE facility. Because waste flows are expected to be less than previously estimated, staff recommend a procurement process that contemplates all WTE technology options within one RFP. Alternatively, the Board may decide to designate 20 c of required new WTE capacity (approximately to 80,000 tpy) for non-mass burn technology options.

6 develop a WTE facility. Selecting a site as a first step could significantly increase the time required to combining ste and technology selection into a single process should be considered: Although selecting a site as a first step would be ideal, there are a number of reasons why Site 85 j 22, 2011 ott4i, Letter from Terry Lake, Minister of Environment, B.C. Ministry of Environment, dated July ATTACHMENT: new WTE capacity. The proposed process is in accordance with the provisions of the ISWRMP as well as the Minister of Environments July conditions of approval of the ISWRMP. recommendations to develop new WTE capacity for the region. This report lays out a strategy to initiate consultations with the FVRD and begin a procurement process to develop On July 30, 2010, the Metro Vancouver Board approved the ISWRMP including 4. CONCLUSION solutions. capacity and either subsequently or in parallel seek proposals for WTE technology Alternatively the Board may decide to initiate a process to establish a site(s) for new WTE with proposed technology solution. Staff recommend an RFP process that encourages proposals that include a site(s) along Proposal evaluation criteria will consider all aspects of proposals including GHG emissions, transportation impacts, etc. propose, the best solution may be two or more sites minimizing waste transportation. scale the most likely solution will be a single site; but depending on what sites proponents If a single RFP process is selected, Metro Vancouver staff expect that due to economies of couple of years, no particular site has been identified as available to Metro Vancouver and suitable for a new solid waste management facility. considerations. Selecting a technology solution without finalizing a site location could result in Technology and site must be considered jointly to understand environmental Although Metro Vancouver staff have explored possible site locations over the last with new surrounding development to maximize energy recovery and use. The Minister of Environment s conditions for the ISWRMP approval stipulate that inregion and out-of-region options be considered equally. benefit of a particular site through co-locating and co-planning a new WTE facility significant project cost additions after a proponent has been selected. The private sector may be more successful than the public sector in maximizing the Page 5 of 5 New Waste-to-Energy Consultation and Procurement Decisions Zero Waste Committee Meeting Date: February

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